In today's world, most companies span several regions and sell across the world. As my Foolish colleague Morgan Housel notes, 10 years ago, less than a third of S&P 500 revenue growth came from abroad. Today, that area makes up half of the S&P 500's growth.
And that number is growing. The truth is, investors regularly underestimate how much demand comes from abroad. More importantly, for large, multinational corporations that have already established a presence in their home markets, much of their future growth comes from abroad.
With that in mind, today we're looking at Accenture
Where Accenture's sales were three years ago
Three years ago, Accenture produced 42% of its sales within the Americas. Its Europe, Middle East, and Africa segment was actually the company's largest geography with 49% of company sales.
Source: S&P Capital IQ.
Where Accenture's sales are today
Today, the Americas have taken over as Accenture's largest segment. Not only that, but Asia is becoming an important region for the company.
Source: S&P Capital IQ.
While the chart above might not make Asia's jump look particularly impressive, it's important to remember that Asia is growing off a small base. Its growth rate dwarfs the Americas in recent years, while Europe has actually seen sales sag.
3-Year Sales Growth
|Europe, the Middle East and Africa (EMEA)||
Accenture's profile isn't terribly different than global competitor IBM
An interesting peer in the space is actually Cognizant
In the end, while the Asia-Pacific region still accounts for just 13% of Accenture's sales, its future sales growth looks increasingly intertwined with its prospects in the region.
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Eric Bleeker owns shares of no companies listed above. Motley Fool newsletter services have recommended buying shares of Accenture. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
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